Full coverage of the City Hall corruption case in federal court

'Extorted' businessman hired Kilpatrick's dad to save city deals

Kwame Kilpatrick and his father Bernard Kilpatrick walk toward the Gateway Deli for lunch during an afternoon break Sept. 18.

A Detroit businessman said he hired Kwame Kilpatrick’s father in 2003 to find out why the city was killing $15 million worth of water department deals.

Lakeshore Engineering Services CEO Avinash Rachmale testified his company’s deals floundered after he rebuffed Bobby Ferguson’s attempt to muscle in on the deals.

The testimony so far is corroborating earlier testimony from Rachmale’s friend and former partner, Tom Hardiman, who spent parts of five days on the witness stand talking about how his firms were extorted by the ex-mayor’s pal, contractor Bobby Ferguson.

After rebuffing Ferguson, Lakeshore’s phone calls went unanswered by the Kilpatrick administration even though the company gave money to the mayor’s campaign.

Desperate, Rachmale paid $2,500 to Bernard Kilpatrick. The money bought a meeting with the political maestro at his Detroit apartment.

Assistant U.S. Attorney Mark Chutkow

“He talked to my partner and said “you need to reach out to Ferguson,” Rachmale testified.

“What was your reaction?” Assistant U.S. Attorney Mark Chutkow asked.

“I was not understanding why,” Rachmale said.

By July, the city had killed Lakeshore’s $5 million contract.

The move was devastating for Lakeshore, at the time a small firm.

“When you lose a $5 million contract, you’re shaken up,” Rachmale testified. “I was devastated. I had stomach aches and couldn’t come to the office for a while.”

“Did you consider leaving Detroit,” Chutkow asked.

“The thought came to mind,” Rachmale said.

One of the canceled contracts went to a rival, Inland Waters, a firm linked to Grosse Pointe Farms businessman Tony Soave.

“Do you know if Mr. Ferguson was working on that?” Chutkow asked.

“Yes,” Rachmale said.

Robert Snell is the Detroit News federal courts reporter. He can be reached at rsnell@detnews.com or (313) 222-2028.